Goodyear Tire & Rubber Co. will close a warehouse and distribution centre in Lincoln, Nebraska by the end of the year, eliminating about 160 jobs. Goodyear spokesman Skip Scherer said the closure was to improve customer service and has nothing to do with the recent announcement that Goodyear will reduce its reported profit for the past six years by an additional $65 million because of improper accounting.
SmarTire Systems Inc. has signed a distribution agreement with Lexani Wheel Corp., a premier manufacturer of luxury alloy wheels based in California. Lexani will bundle SmarTire’s tyre pressure monitoring system with its innovative Johnson line of custom wheels. Lexani wheels are sold through an extensive dealer base and are well known in the American automotive aftermarket, boasting a prestigious list of clients and countless award-winning show vehicles. A purchase order accompanied the distribution agreement.
ProLogis, a leading global provider of distribution facilities and services, today announced that it has signed a build-to-suit lease agreement with Bridgestone, one of the world’s largest tire manufacturers. Bridgestone will lease 245,611 square feet (22,818 m2) of distribution space at ProLogis Park Evry located on the outskirts of Paris.
The new Chairman of the NTDA Tyre Wholealers’ Group, Peter Gaster took to the floor at the NTDA TWG luncheon to offer one or two points for the trade to consider. Gaster opened by highlighting the fact that whilst he was looking at things from a wholesale point of view, it was worth remembering that many at the event had a foot in both retail and wholesale camps.
He outlined the importance of the role of the wholesaler, comparing the ability of the multi-brand wholesaler to that of the tyre manufacturer and how the result was benefiting the tyre trade as a whole. “The true wholesaler performs a vital and necessary function in the UK distribution market in providing a variety of products and deliveries to all retail sectors in the industry and it is here that the wholesaler performs the most vital function which is service. We are all aware of the cost of distribution and I’ve always felt that manufacturers have at the best misunderstood and at the worst miscalculated the cost of distribution and the reality of the logistics and practicality of delivering one tyre to one customer on a daily basis.
For the full year 2003, Bandag reported consolidated net income of $60.2 million, or $3.11 per diluted share, compared to 2002 net income of $2.8 million, or $0.14 per diluted share, which included the write-off of goodwill, primarily of TDS (Tire Distribution Systems, Inc), of $47.3 million net of income tax. Consolidated net sales for 2003 decreased nine percent to $816.4 million from $900.5 million in 2002.
Kumho Tire Co. Inc. is building a second tyre plant in China, next to an existing plant in Nanjing, that will double annual production capacity in China to 10 million units by 2008. The 130 million US dollar project will provide Nanjing Kumho Tire Co. Ltd. with additional capacity aiming to increase its share of the passenger radial market in China to 25 per cent, according to Kumho. In conjunction with the expansion project, Nanjing Kumho is setting up distribution hubs in northern China. The project is separate from a new plant Kumho opened recently in Pyeongtaek, South Korea, using proprietary automated technology.
There are signs that Continental AG is moving ahead with the reorganisation of its passenger tyre business in North America. Continental Tire North America, Inc. and Exel announced today that they have agreed to form a strategic partnership in the area of tyre distribution logistics in North America. Exel will assume control of, among other things, the management of CTNA’s tyre distribution warehouses. All details of the agreement will be finalised by April 1, 2004.
Michelin and IBM have announced that they have signed a partnership agreement valued at 1 billion euros. According to this 8-year agreement, IBM will take over the management and maintenance of Michelin’s IT infrastructure in North America and Europe. This commitment includes a focus on achieving optimal financial results through the application of best practices in terms of technology adoption and utilisation as well as access to the best skills available in the domain of information technology. Around 600 current Michelin employees will join IBM in 2004. Under the terms of this agreement, IBM will be responsible for the following Michelin IT infrastructure activities: IT production operations and management, user support, technical support, solution industrialisation and distribution of servers, workstations, PCs, software and production applications.
In Las Vegas, where the SEMA show is currently taking place, Goodyear’s chairman, CEO and president Robert J. Keegan found the time for an exclusive interview with TYRES & ACCESSORIES. It wasn’t his plan, says Keegan, to only bring in new executives from outside into the company, but to promote long-time colleagues as well, if they were capable of leading. But Keegan doubts that those who have led Goodyear into the current crisis are those who can bring the company out of this situation. The chairman of the tyre maker calls this “changes for victory.” Keegan is convinced that right now he has the appropriate personnel aboard in order to move ahead with the company. Keegan points out seven key elements of his strategy: leadership, cash is king, cost structures, tapping the full potential of all channels of distribution, product leadership, build-up and upgrading of Goodyear’s brands, and an optimal supply chain. In Northern America Goodyear expects a remarkable improvement now that Jonathan Rich, who is president of North American Tire, has been able to hire the right team. According to Keegan this is “the best team we have ever had in this area.”
SmarTire has signed a contract manufacturing services agreement with Hyundai Autonet Company (HACO), a Korean automotive electronics company, whereby HACO will manufacture SmarTire’s tyre pressure monitoring systems for global sale and distribution by SmarTire. HACO is a subsidiary of the Hyundai Group.
Bandag turned over $211.4 million in the third quarter, 14 per cent down on the 3Q 2002 figure of $245.9 million. This was largely due to lower sales at distribution subsidiary company Tire Distribution Systems. Consolidated net income, however, was up slightly at $20 million ( $19.6 m 3Q 202). Bandag’s Chairman and CEO Martin Carver said he was “cautiously optimistic” that the US economy was improving and that this would be reflected in sales.
A sports car tyre retreading business has been launched in Wales. Maxsport Competition Tyres is to create up to 25 new jobs at its new tyre retread facility in Rhayader, Powys where it plans to eventually retread more than 50,000 tyres a year, primarily for the motorsport and off-road vehicle markets in Europe and Asia. The company, which has invested more than £1m in a 37,000 sq ft unit at the town’s Brynberth Industrial Estate where it currently employs nine people. Maxsport Competition Tyres is part of the Treble B Group based at Caterham, Surrey, which distributes new and retreaded tyres throughout the UK and has depots in England and South Wales. The group plans to open a new storage and distribution facility in Rhayader in the future.
SmarTire Systems has announced that it has signed an agreement in principle appointing Beijing Boom Technology Co. Ltd. as the master distributor of SmarTire’s Tyre Pressure Monitoring Systems (TPMS) in China. Beijing Boom Technology has agreed to purchase over $1.5 million in additional aftermarket passenger car TPMS systems at fixed intervals over the next twelve months. In order to maintain its status as SmarTire’s master distributor in China, Beijing Boom Technology must also purchase approximately 3.9 million dollars in additional aftermarket passenger car TPMS systems during the twelve-month period commencing September 1, 2004 and establish a network of certified dealers in all provinces of China by May 1, 2004.
A success story for Marangoni is its activities in Brazil, thousands of miles from its European activities. Marangoni’s involvement in Brazil began in the early 90s as a partnership with Brazilian market leader UNISA for the transfer of technology for the manufacture and marketing of the Ringtread product. At its height, there was a network of 15 authorised RTS dealers in Brazil.
However, the serious economic downturn saw UNISA go bankrupt, threatening Marangoni’s progress in Brazil, but the operation in that country was kept alive by the determination of a group of former directors of UNISA, headed by Mr. Dary Fernando Figueiredo. The reason that Marangoni was so keen to remain established in Brazil is that the country is the world’s second largest market for retreads, with a monthly consumption of 12,000 tonnes of rubber, which corresponds to some 10 million retreaded truck tyres annually.
In 1998, Mr. Dary Fernando Figueiredo founded a new company with its head office in Sao Paulo, which had a small warehouse and just one customer. This eventually became Marangoni do Brasil and, in April 2001, a new facility was opened for the production of precured treads, representing an investment equivalent to nearly 12.6 million Euro at current exchange rates and covering an area of 53,000 square metres. Growth was rapid and, in 2002, the volume of treads produced reached 220,000, for 30 customers. The key to this success lies in the close partnership established between authorised dealers and Marangoni do Brasil; a relationship focused on the distribution of the product and the commercial assistance provided to the dealers in their work in the fleet market.
As far as Marangoni is concerned, the story is far from over, as future sales objectives involve a portfolio of more than 50 customers and sales of 550,000 retreads by the year 2005.
Whilst it was Digital data gathering that set the ball rolling for RL Automotive, today it caters for the tyre market’s every need.
RL Automotive is a far cry from the usual tyre parts supplier. Here is a business where, from the outset in 1998, technology was always going to be at its core. Unlike many opportunists who see the tyre industry as a market for their latest software packages, RL Automotive is much more directly linked to the tyre business and offers technology in such a way that even the most Luddite of mechanics (is that a contradiction in terms?) can understand the benefits.
It began with the understanding that the emphasis on tyre costs was moving away from the cheapest-to-buy policy, to the cheapest-to-run, cost-per-kilometre approach to tyres. The tyre management theory of extending tyre life through a proper monitoring and maintenance schedule is in itself nothing new, but it is something that can only truly be worked efficiently by using computers to analyse the data gathered.
With the advance of computer technology there is no difficulty in compiling statistics and generating maintenance schedules from the statistics. The problem lies in the gathering of the data. Amazingly, it is still being done manually onto bits of paper, often using “less than perfect” tread probes. The whole process leads to poor quality data on reams of paper that more often than not can not be analysed correctly. It is also a system which cannot function in wet weather!
Mark Longden, MD of RL Automotive, saw an opportunity to develop digital tyre reading equipment that made life simpler for the collector of the data. It also created a platform that can, with wireless technology, enter and then deliver data from the tyre depth gauge into the vehicle record back at base. Where relevant, this same information can then effortlessly be collated at Head Office and the information used in countless ways.
At the same time as developing this digital product range, the company has built up a mainstream Tyre Service Products distribution business by selecting high quality products from around the world.
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